WATPAC CLINGS TO CONSTRUCTION AS PROFIT SUFFERS

Written on the 24 August 2016 by Brisbane Business News

WATPAC CLINGS TO CONSTRUCTION AS PROFIT SUFFERS

SPENDING 12 months riding a down-turning industry, Watpac Limited (ASX: WTP) has emerged a little bruised, yet not completely out for the count, following its full year result.

Posting a statutory loss after tax this morning of $21.4 million, down from an $11.5 million loss in FY15, the Brisbane giant admits its result was once again affected by the volatility faced by its mining and civil segment.

However, Watpac chair Richard McGruther notes that a slightly improved revenue of $1.2 billion, supported largely by the company's construction segment, hoisted Watpac back to its feet to close out the year.

"As previously reported the group's mining and civil business recorded a number of impairments in the first half of the reporting period, however the business unit has pleasingly returned to profitability in the second half of the financial year," says McGruther.

"The construction business continued to operate profitably and achieved a solid return on equity in FY16 despite the impact of two significant loss-making projects."

Watpac's mining and civil revenue fell to $166.5 million from a previous result of $284 million, while construction project revenue buoyed at $1.04 billion, up from the FY15 result of $929 million.

McGruther is optimistic that Watpac won't be going down with Australia's mining ship, and instead will focus on its more profitable sectors in the year ahead.

"We have recognised the changed dynamics of the resources sector and tailored our business to suit these market conditions accordingly," he says.

"Despite the challenges faced in FY16, we have made substantial inroads on many of our objectives, aimed at creating long-term value for all of our stakeholders."

Referring to a number of new projects on the horizon within varied sectors, managing director Martin Monro (pictured) says the future looks brighter.

"We have strengthened our place in a number of sectors including health, education, defence & secure environments and the delivery of social infrastructure through Public Private Partnerships," says Monro.

Significant projects underway for Watpac include the Victorian Schools PPP, the Ryde Garden residential development in Sydney and the Mary Lane hotel and residential precinct in Brisbane.

Watpac also recently won the title of Project of the Year for its delivery of 180 Ann Street in Brisbane, awarded by Master Builders.

No dividends have been declared for the FY16 period.

Watpac is currently trading at around 80c on the ASX, down almost 15 per cent from opening at 94c.

READ MORE FROM WATPAC:


Author: Brisbane Business News Connect via: Twitter

Latest News

CROMWELL TRADES STEADILY IN FIRST HALF

CROMWELL Property Group has maintained a steady operating profit at $0.045 per security in the first half of FY17,...

WHY NEXTDC'S STOCK IS SOARING

AFTER posting its interim result, NEXTDC (ASX: NXT) gained more than 12 per cent on the stock market before noon.
...

PWR PROFIT CRASHES AS DOLLAR RISES AND COSTS MOUNT

A RISING Aussie dollar has offset PWR Holdings Limited's (ASX:PWH) overseas growth in the last half, forcing a...

SUPER RETAIL GROUP RESULTS SHINE ACROSS THE BOARD

A WELL-planned and executed half has paid off for Super Retail Group (ASX:SUL) as it posts a net profit result up ...

Related News

EVERYTHING YOU NEED TO KNOW ABOUT THE NATIONAL BROADBAND NETWORK

THE National Broadband Network (NBN) is more than an internet connection, it is an opportunity to transform your b...

WHY EMPLOYEE-OWNED COMPANIES ARE BEATING ASX200 SHARE PRICES

EMPLOYEE-owned companies command a higher share price than their publicly listed peers, reaping a 17 per cent prem...

RISE OF THE MACHINES HAS WORKERS SWEATING

UP TO 3.8 million Australian workers are fearful their job may soon be terminated by a robot, a new survey has shown....

LESS TALK, MORE SMALL BUSINESS ACTION IN 2017

THE future growth and prosperity of Australian SMEs could be undermined if governments lose sight of the sector...

Contact us

Email News Update Sign Up Contact Details
Subscriptions

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter